Clearlake Capital-backed software company Ivanti saw its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) plummet by 21% to $146 million in the first half of 2026. This decline comes as the company faces intensified competition from larger rivals like ServiceNow and Microsoft, alongside ongoing product challenges and cybersecurity vulnerabilities. While Ivanti maintains a substantial recurring revenue base, largely from maintenance contracts and a growing share of subscription and SaaS fees, the company is struggling to maintain its market position against more dominant players in its individual segments.
Adding to its woes, Ivanti has been under scrutiny for significant cybersecurity breaches. In early 2024, the U.S. Cybersecurity and Infrastructure Security Agency (CISA) mandated that all federal agencies disconnect their Ivanti VPN appliances due to exploited vulnerabilities, a directive that highlighted the severity of the company's security issues. Prior to that, in February 2021, Chinese hackers breached Ivanti's Pulse Secure VPN subsidiary, planting a backdoor that compromised 119 other organizations. These security failures have eroded customer trust and contributed to the company's financial downturn, with Bloomberg reporting that cost-cutting measures after its 2017 acquisition by Clearlake Capital may have weakened its security infrastructure.
The financial strain on Ivanti has been a concern for lenders, leading to a recent liability management transaction in April 2025. This deal saw the company raise $350 million in new super-senior money and extend its current facilities, aiming to address liquidity concerns, particularly the maturity of its Revolving Credit Facility in December 2025. Fitch Ratings had previously placed all of Ivanti's ratings on "Credit Watch Negative" in February 2025, citing liquidity issues, limited cash, and high leverage, which had exceeded 7x in 2024 due to reduced EBITDA and increased RCF utilization. Despite the restructuring, concerns remain about the company's ability to recover given its competitive landscape and ongoing operational challenges.
